According to the latest IEA report 'Renewable Energy 2023', the global installed capacity of renewable energy reached a significant increase of nearly 50% in 2023, with a total of nearly 510 GW. Among them, the newly installed capacity of solar photovoltaics increased by 31.8% year-on-year, reaching 375GW, accounting for three-quarters of the global renewable energy capacity. China and Europe, as the main drivers of this growth, should not be underestimated in their contributions.
The European Photovoltaic Industry Association's "2022-2027 European Solar Energy Market Outlook" shows that the newly installed solar energy capacity in Europe reached a historic high of 55.9 GW in 2023, an increase of 40% compared to the previous year. The IEA further predicts that the installed capacity of solar photovoltaics worldwide will surpass hydropower, natural gas, and coal-fired power in the coming years, becoming the most installed power generation technology. This undoubtedly highlights the core position of the photovoltaic industry in the energy transformation of China and Europe.
Common Goals Lead the Way Forward
On December 7, 2023, the 24th China EU Leaders' Meeting was successfully held. The leaders of both sides unanimously emphasized the adherence to multilateralism and committed to strengthening green energy cooperation to promote energy transformation in China, Europe, and the world. Under the dual drive of policy guidance and market demand, China's photovoltaic industry has formed a complete industrial system, solid technological support, and a high global market share. In contrast, the EU has provided a solid foundation for the deployment of solar energy through its comprehensive energy policy, well-established grid integration and regulatory system, and relatively transparent market environment.
In terms of goal setting, the EU's "EU Solar Strategy" and revised Renewable Energy Directive both reflect its ambitious goals for solar energy development. In terms of financial support, the EU provides funding for research and innovation, manufacturing projects, and energy infrastructure in the energy sector through multiple programs.
Localization of Industries and Challenges
The EU has also spared no effort in industrial localization construction, launching the "European Solar Photovoltaic Industry Alliance" and extending relevant national subsidy policies. However, the EU photovoltaic industry has recently been caught in a crisis, with multiple photovoltaic module manufacturers and silicon wafer manufacturers filing for bankruptcy or layoffs. The European Solar Manufacturers Association attributed this dilemma to Chinese photovoltaic products and lobbied for stricter access standards and anti-dumping actions.
This viewpoint has been widely opposed. More than 400 European institutions, including solar manufacturers, research institutions, and associations, have published an open letter on the Solar Power Europe website opposing any trade protection measures against the solar industry. Bruegel's latest analysis also points out that accelerating the deployment of solar energy is more important for Europe than developing its own manufacturing capabilities.
The highly complementary green industries between China and Europe have broad prospects for cooperation in the photovoltaic industry. To avoid cognitive biases and short-term market competition in a single field that may interfere with the overall extension of the cooperation chain, China and Europe should focus on the following four areas of cooperation:
1. Joint technology research and development: As the photovoltaic industry enters a new stage of technological transformation, China and Europe should leverage their respective advantages, focus on deepening innovation research and investment cooperation, and jointly promote the progress of photovoltaic technology.
2. Cross border investment between enterprises: Chinese and European enterprises should enhance compliance capacity building through cross-border investment cooperation, adapt to the high standard market competition environment, and contribute to the accelerated deployment of clean energy, talent cultivation, and supply of high-quality employment opportunities in Europe.
3. Extension of the "PV+" industry chain: China and Europe should take "PV+" as the main direction, explore the extension of the cooperation chain, stabilize costs, and leverage the complementary advantages of both sides. This includes cooperation in the integration of solar photovoltaic buildings, the co construction of photovoltaic industrial parks, and the application of "photovoltaic+" in multiple fields.
4. Jointly developing third-party markets: China and Europe should work together to develop third-party markets, such as underdeveloped countries and regions in Africa, and jointly promote the deployment and development of renewable energy worldwide.